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Drug card program turns spotlight on seniors' costs

Physicians help steer patients to resources that can save them money on prescription drugs

From the December ACP Observer, copyright 2004 by the American College of Physicians.

By Bonnie Darves

Six months after Medicare launched its discount drug card program, many internists say they are still fielding calls from baffled patients who wonder how the plan works and if it can save them money.

While the transitional card program was introduced as a precursor to the full Medicare drug benefit that takes effect in 2006, physicians say it has been a source of confusion for many patients. Some critics claim the plan is so user-unfriendly that many seniors have simply given up trying to use it.

Take Therese Lynch, a 79-year-old resident from Newport Beach, Calif. She paid $30 to fill out applications provided by her pharmacist for two discount cards, but found out that neither saved her any money on the three expensive drugs she uses. "It turned out costs were even higher with the cards," Ms. Lynch recalled.

Consumer advocates say that other seniors have reached the same conclusion. But even critics of the card program say that other aspects of Medicare's transitional drug reform—including a prescription credit that millions of low-income seniors are eligible for but not taking advantage of—can help older Americans slash their prescription costs.

At the same time, reform efforts have raised awareness—among physicians, health plans and communities—about the challenges many seniors face in paying for medications.

A daunting process

According to the Centers for Medicare and Medicaid Services (CMS), 5.8 million Medicare beneficiaries (out of 7 million who are eligible) have signed up for a Medicare discount card. Most of those enrollees, however, were automatically enrolled in a card program because they belong to a Medicare managed care program.

For many seniors, the problems with discount drug cards begin with an enrollment process that can be tough even for computer-savvy patients. To apply online through the CMS Web site, beneficiaries must have at their fingertips information on all the drugs they take, with dosages and monthly costs per drug.

After inputting all that information, consumers should wind up with a "short list" of five different card options they then must narrow to one. While the card program was originally touted as cutting costs by up to 40%, some seniors, like Ms. Lynch, claim the program doesn't deliver nearly that level of savings. That has led not only patients to speak out against the program, but some physicians as well.

"The Medicare discount card program is mass confusion," said A. Carolyn Linnebur, FACP, a general internist with Medical Associates of Northern New Mexico in Albuquerque. "Most of my patients have told me it's not worth the trouble because the savings are negligible."

But other physicians are more sanguine. William J. Hall, MACP, for instance, who heads the division of geriatrics at the University of Rochester in Rochester, N.Y., and is a former College President, said he appreciates any effort by Medicare to help seniors get discounts. Still, he questions the complexity of the program's design.

"The CMS has done a good job helping computer-literate beneficiaries find their way through the offerings," he said. "The problem is that there is no universal card, and the formularies vary per card. If you use the Web regularly and know your meds, you can figure out the best deal. But most of my patients in their 70s don't have a prayer of figuring out how to use the program."

Program details can be intimidating. There are several dozen different sponsored cards, each providing different discounts on some or all of the "top 100" drugs Medicare has identified as those most commonly prescribed to seniors. Sponsors can choose to include as few as 64 of those drugs in their card formulary, which can limit seniors' choice.

Medicare officials are quick to point out that they have continually fine-tuned communication materials and revamped their Web site to help seniors make their way through the card-selection process. While seniors who applied online last summer, for instance, were given as many as 12 different card options to choose from, the current online process offers them only five to make selection simpler.

And seniors without access to a computer can call a Medicare toll-free number (800-633-4227) and work with a representative who will walk them through the card-selection process. (Patients must still fill out program applications once they arrive in the mail.)

The CMS points out that it has hired many more service representatives to help seniors over the phone. The agency has also added several features to its Web site to guide beneficiaries, including an application checklist and a section on frequently asked questions. But physicians point out that computer literacy and real savings issues still remain.

"The problem is that the mechanisms for choosing the right card are pretty sophisticated for a lot of seniors," said J. Douglas Lee, MD, medical director of pharmacy at the Marshfield Clinic in Marshfield, Wis. "And most of the cards are only marginally better [in terms of price] than patients can find if they just shop around." When it comes to saving money, Dr. Lee added, many patients can probably do as well shopping for medications at large drugstore chains.

Silver lining?

At the same time, patients' experience with the discount card program, as well as Medicare drug reform in general, has cast new light on the issue of drug costs. While physicians and patients debate the merits of different reform measures, both the public and providers are taking a new look at resources for saving seniors money.

For example, Dr. Lee's clinic, which has more than 730 physicians, also operates a health plan. Health plan members at any of the 30 clinic sites in northern Wisconsin can purchase prescription drugs for the same price the insurance plan pays for them.

As a result, most of Marshfield's patients don't need a Medicare discount card to save money on prescriptions. The clinic also operates a patient assistance center to help patients with everything from hospital bills to drug costs.

In addition, Dr. Lee pointed out, Wisconsin operates a progressive, generous drug assistance program for state residents. That's also the case in Vermont, where older patients can take advantage of a state assistance program if they meet income criteria, said general internist Keith W. Michl, FACP, a solo practitioner in Manchester Center, Vt., and a former Governor for ACP's Vermont Chapter.

The program there is so good, he said, that not one of his patients has asked for help applying for a Medicare discount card. But Dr. Michl said he suspects that many patients are taking matters into their own hands and going across the border.

"Many of my patients spend a lot of time talking to the Canadian pharmacies, figuring out who has the best prices for which medications," he said. He also makes it a point to talk to patients about the cost of the drugs he prescribes, looking up prices that patients can compare on his electronic prescribing software program and helping them fill out applications for pharmaceutical assistance programs.

'Multiple resources'

Vinod N. Velakaturi, ACP Member, a general internist with the five-physician Jackson County Medical Group in Independence, Mo., said that many patients ask him to help them figure out how to manage the costs of medications he prescribes. Like Dr. Michl, he helps patients apply for assistance programs offered through pharmaceutical companies, and advises them on mail-order savings and less costly generic alternatives.

He starts by asking patients what drugs their insurance covers and what their co-payments are for generics and brands. He also keeps tabs on which community pharmacies have the lowest prices on frequently prescribed drugs, such as the rock-bottom $6 price tag he found locally on 100 tablets of hydrochlorothiazide.

And he has begun talking up tablet-splitting to patients so they can save money by buying higher doses of prescribed drugs. (According to Rochester's Dr. Hall, his local Blue Cross plan has started giving physicians pill-splitting devices to hand out free to patients.)

"I'm all for patients saving money any way they can," Dr. Velakaturi said, "as long as it doesn't jeopardize their care. The more questions you ask your patients, the more you can figure out what might help them without making them destitute."

But few physicians or their practices have either the time or resources to offer informed guidance on how to manage prescription costs. "We tell doctors to simply advise patients where to get help, from Medicare or local resources such as their local office of the division of aging," said Marshfield Clinic's Dr. Lee. "We cannot educate more than 700 providers to give expert advice—nor should we—when other people can do it better and less expensively."

Physicians in some communities can turn to excellent local resources. In Boston's western suburbs, for instance, a program called MetroWest Meds now helps patients in more than a dozen towns access free pharmaceutical assistance programs—and select an appropriate Medicare drug discount card. The program, which was launched at the beginning of the year, is funded through a foundation created when a local nonprofit hospital system went for-profit.

Staff members, from a local visiting nurse association, interview patients, help them gather necessary documentation and then guide them through the card- or program-selection process, explained program manager Susan Moriarty, MSW. What advice does she give for cutting seniors' prescription costs?

"You need multiple resources working together to make drugs affordable," she said. She has, for instance, been able to save patients money by helping them select the optimal drug discount card—and then enrolling them in a generic drug assistance program, like Rx Outreach, as well. (See "More cost-saving resources.")

Real value

According to Ms. Moriarty, one of the most valuable resources now available is another element of Medicare's transitional assistance program that has received much less attention than the discount cards.

As part of the drug card program, Medicare is now offering a $600 prescription drug credit to eligible low-income seniors for both this year and next, for a total of $1,200. (According to Peter Ashkenaz, a CMS spokesperson, only 1.4 million beneficiaries have signed up for the credit, out of a projected 4.7 million who are eligible.) To receive the credit, beneficiaries must have incomes below 135% of the federal poverty level, which is $18,000 for individuals and $24,000 for married couples filing jointly.

Organizations like the AARP are working with members to help them make sense of the various discount cards, and see if they qualify for the credit. Wayne Moore, JD, who serves as senior advisor to AARP's director of policy, said that half the battle is ensuring that people who qualify for the credit actually receive it. (See "Applications for Medicare drug credit are due by Dec. 31.")

"What's best for low-income beneficiaries," he said, "is not the discount card but the $600 credit, if they qualify—and whether there is some sort of wraparound from a pharmaceutical company." According to Mr. Moore, Merck, Pfizer and GlaxoSmithKline, among other drug companies, operate programs that allow seniors who qualify for the $600 credit to get drugs at low or no cost, after their credit has been applied.

"If patients are able to take advantage of those wraparound features, it could add up to much more than $600 a year in savings," Mr. Moore said. "Even the most severe critics of the [Medicare discount card] programs think the credit component of those programs has value."

Bonnie Darves is a freelance writer in Lake Oswego, Ore.

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More cost-saving resources

The following are several Web-based resources that can help patients get discount prices on prescription drugs:

  • Medicare's "Prescription Drugs and Other Assistance Programs" site. This official Medicare site includes information on public and private programs that have discounted or free drugs. Visitors can use the site to apply for one of dozens of Medicare-approved drug discount cards and a $600 prescription assistance credit, as well as for information on generics and help with other health care costs.

    Medicare beneficiaries who don't have access to a computer can apply to the discount card program by calling 800-633-4227.

  • Access to Benefits Coalition. The site is designed for Medicare beneficiaries with lower incomes.

  • Medicare Rights Center (MRC). The MRC is an independent source providing Medicare information and assistance.

  • National Council on the Aging. The council's BenefitsCheckUp site provides information on more than 1,300 national programs for prescription drug discounts, as well as other health care-related items and services. A questionnaire helps visitors find the appropriate program.

  • Rx Outreach. Designated for qualified low-income individuals and families, the site, launched by Express Scripts and supported by the Robert Wood Johnson Foundation, gives patients access to generic drugs.

  • Rx Together. Founded by several large pharmaceutical companies, the site is billed as a free prescription savings program allowing Medicare beneficiaries to access more than 150 approved drugs.

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Applications for Medicare drug credit are due by Dec. 31

Physicians whose patients might meet low-income criteria established by Medicare for its transitional assistance program drug credit should encourage patients to apply. If eligible patients do so before Dec. 31 of this year, they will receive a $600 credit for both 2004 and 2005, for a total of $1,200.

Because enrollment in the credit program—which is part of the discount card program—has been slow, Medicare began auto-enrolling certain beneficiaries earlier this fall.

Internists may be seeing patients in their offices who have received the auto-enrollment notification letters as well as accompanying Medicare cards, and should encourage patients to complete the required forms to ensure the credit is applied.

The low-income credit is available only to beneficiaries who meet the income eligibility requirements—below 135% of the federal poverty level—and have enrolled in a drug-discount card program. Patients receiving benefits through other Medicare programs that target low-income beneficiaries or those with special needs may also be eligible.

Beneficiaries who apply before Dec. 31 of this year may receive the full $1,200 credit for both 2004 and 2005, said Peter Ashkenaz, a spokesperson for the Centers for Medicare and Medicaid Services. If they wait until next year to apply, however, they'll receive only credit for 2005—and that credit amount will be reduced, he said, depending on when patients apply during the year.

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